KBA’s payment digital solutions firm to enhance member banks’ interoperability

The umbrella commercial banks’ industry body, Kenya Bankers Association (KBA) has established a fully-fledged payments technology delivery service firm as part of a strategic effort to boost the banking sector’s interoperability and efficiency through affordable technology-based solutions.

The establishment of the new firm will provide a go-to-market platform via the Kenya Interbank Transaction Switch (KITS), geared at harnessing digital payment solutions for the local market.  

(TOP: KBA Vice Chairperson and CBA MD Jeremy Ngunze (left) flanked by KBA Chairperson & KCB Group CEO Joshua Oigara and KBA CEO Habil Olaka (second right) flanked by the Integrated Payments Service Limited CIO Michael Mbuthia during the launch of the IPSL corporate identity).

Integrated Payments Service Limited (IPSL), a fully owned KBA subsidiary will provide technology-based payment solutions to the association’s member banks, at subsidized rates.

Speaking when he confirmed the setting up of IPSL, KBA Chief Executive Officer, Mr. Habil Olaka, said the launch of IPSL is part of the Association’s mandate to continue reinforcing a technology-driven and vibrant banking sector, responsive to the dynamic consumer needs.

Founded under the Central Bank of Kenya, National Payment System (NPS) guidelines, Olaka explained that IPSL would interconnect all banks in Kenya. The firm, he said, will also inform policy direction and manage the risks associated with payment systems in the market, while providing technical and related guidance to KBA member banks.

The setting up of IPSL, Olaka added, is also part of a strategic effort by KBA to enhance ongoing financial inclusion efforts through diversified commercial banking delivery channels, including mobile and internet-based platforms as the country gears to become a cash-lite economy in line with the global digitization trends.

 “At KBA, we have set our sights on facilitating cost effective, secure commercial banking solutions as part of our goals to more than double formal banking penetration rates in Kenya,” Olaka said, adding that, “IPSL, is therefore coming on stream to address the inefficiencies within the banking payments system in Kenya, with the value proposition for innovation, enhanced efficiency and risk management.”

As part of its operational strategy, IPSL will soon be unveiling an interoperable, advanced person-to-person (P2P) payment solution. The solution is currently on its testing phase with a complement of more than 20 member banks participating in the User Acceptance Testing (UAT) trials.

Commenting on the Technological platform adopted by the firm, IPSL, Chief Information Officer, Mr. Michael Mbuthia, said that the technology stack will run a new generation interoperable payment transactions switching platform. The development of the platform, which will complement KBA’s existing, clearing house and follows the recent signing of a financing agreement between KBA and Bank of Baroda, as the project financers.

Once complete, the IPSL system will provide a safe, secure and cost efficient platform for person-to-person (P2P) money transfer. These transfers will be initiated from the five main bank channels: Mobile banking (USSD & Application), Internet banking, ATM, Branch front office, Agency Banking and POS.


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